What's up with the ER2 and EMD today? ES, NQ, DJI, NYA, and COMPX all sold off this morning while the ER2 and EMD went choppy sideways. Now those indices are rallying while the ER2 and EMD are stuck. Are there forces out there conspiring to keep ER2 and EMD stuck in a pathetic tiny range. It feels like there are counteractive orders killing the potential moves instead of the moves just drying up from lack of interest. Range for ER2 is 42% of ES range, 4.5 pts vs 10.75. Normally the ER2 range is at least 70% of ES range, often more than 100%. This basically means you get more bang for the buck with the ER2. Maybe this is the natural progression of an index futures contract: Lively price action and good follow through to fake moves, stuck price action, little follow through, and an abundance of counteractive orders to stop any movement. I've seen this happen to NQ and ES. I've heard from others about how this happened to the DAX. Or it could be just 1 bad day. Any thoughts?
I don't trade the ER2 but what seems to happen in other markets if this starts becoming a new pattern is that spreaders start entering the market with enough size to kill the follow through that everyone used to love and come to expect. Then again maybe today was just an oddity.
I noticed today's action as well. I believe it is just the current trading action, no funny business or anything.
aside from this being rollover week, early summer, and the Russell announcing addition and deletion candidates for the Russell 3000 reconstitution set for June 24, today really wasn't anything unusual. in fact, volume was as high as it has been since mid-may. as for volatility, it was about half of the ES, which is pretty common. this was also after a couple of wide range days, so some range consolidation wasn't surprising. hope this helps. take care and gtty ... omni